Poor Farmers’ Income Improvement through Innovation Project, Poor Farmer Empowerment Component, Indonesia (Board Approval in 2002)
4.4.2 Poor Farmers’ Income Improvement through Innovation Project, Poor Farmer Empowerment Component, Indonesia (Board Approval in 2002)
4.4.2.1 Overview
135. Growth of the agriculture sector in Indonesia has stagnated and lags behind other sectors. It is the employer of a large percentage of the country’s population and a substantial source of food and raw materials for manufacturing. Lessons from ADB experience indicate that previous agriculture projects were too complex, targeted diverse environments, were overly rigid, and were inflexible in design.
136. The Poor Farmers’ Income Improvement through Innovation Project will support participatory planning in eligible villages to identify agricultural innovations and public investments necessary for adoption. It can be considered a CDD project because it aims to organize village project investment committees (VPICs), elected in each project village, to validate and consolidate investments proposed by farmer groups that will directly receive funds for subprojects they themselves select. This project will establish, develop the capacity for, and support operation of three levels of community participation: VPICs, project intervillage forums, and district coordinating committee. These structures will work together to consolidate, scrutinize, approve, support, implement, and monitor investments proposed by farmer groups. VPICs will ensure that implementation is in line with proposals and in accordance with guidelines. Implementation progress and disbursements will be posted on village bulletin boards. VPICs will maintain records accessible to the public.
4.4.2.2 Highlights of design phase
137. This project followed a new ADB business practice that came into effect in 2002, which allowed simultaneous project feasibility study and project designing in order to hasten project preparation. The project officer combined the two stages of project preparation. However, the project still took more than
18 months to be approved. 138.
The project officer was not satisfied with the initial consultant reports. He observed the fieldwork of consultants very closely. After absorbing the rural situation in Indonesia, he decided that the project design needed to conform better to the conditions he saw. Based on another agriculture project of ADB for Indonesia, he decided that this project needed a greater role for the farmers.
139. There was unfavorable reaction from some bank staff when he circulated his project design for interdepartmental comments. Some staff wanted feasibility studies for the community subprojects. Others wanted to know the basis of his confidence to put so much money in the hands of farmers. He defended the project design by saying that there could be no detailed feasibility studies for subprojects because those were to be identified by farmers. He noted that part of the project design was providing technical assistance to farmers by contracting local NGOs that would guide them through project identification and preparation. He was also considering the tradeoff between larger projects that deliver higher volumes of aid but with less targeting options versus smaller resources delivered directly to communities, with the added benefit of greater community empowerment.
140. His confidence came from the support of the Indonesian government for this CDD type of project. Apart from the emerging success of the Kecamatan Development Project (KDP) (one of the World Bank’s foremost CDD models), this project supported the decentralization law, which gave more authority to local communities. He studied the KDP and tried to improve on some of its weaknesses; for example, this project gave decision-making power to the village level whereas the KDP stopped at the subdistrict (kecamatan) level.
141. Through persistence and patience in explaining the concept to those who were initially skeptical about the project design, and with support from some senior staff who were interested in the innovative design, the project was finally approved.
4.4.2.3 Implementation highlights
142. The project’s challenges continued when implementation started. First, project effectiveness was delayed by nearly a year. Upon effectiveness, project managers realized that the qualification standards for the national NGO were hard to meet, and it was only almost two years later when one was contracted. Another four months were needed to complete the hiring of local NGOs. The project designers wanted to give the local community the flexibility to choose which local NGO it would contract because they did not want a monopoly of this job by a few NGOs with fixed ideas to sell to the community.
143. Meanwhile, the executing government agency had to field its own staff in order to keep the project moving and to avoid losing government counterpart funding. Project implementation unit staff attended to a number of selected villages in the interim. They assisted these villages in selecting their village facilitators who were then trained to follow the participatory processes prescribed in the project design. The facilitators formed VPICs that were able to prepare subproject proposals and eventually manage the construction of such subprojects.
144. Eighteen of these villages were visited during the latest review mission in the last quarter of 2005. The mission reported that all the villages visited had elected their representatives and organized village committees as prescribed. Subprojects, consisting mainly of farm-to-market roads and small irrigation 144. Eighteen of these villages were visited during the latest review mission in the last quarter of 2005. The mission reported that all the villages visited had elected their representatives and organized village committees as prescribed. Subprojects, consisting mainly of farm-to-market roads and small irrigation
145. The new project officer who took over the implementation phase says the work of the executing agency was satisfactory. However, he feels that NGOs will help to fully apply the participatory features of the project. As the project increases in scale, he is aware that the executing agency will depend on the local NGOs to reach the target villages and manage the community processes effectively.
146. Because of the delays in its start-up, as of the last review mission in the last quarter of 2005, the project was nearly 50% behind schedule. Nevertheless, the project officer is confident that the project will now proceed smoothly. People in interim project villages have actively participated in and are fully satisfied with the project. Consultants, national NGO, and local NGOs are all taking up their roles. The project officer is an economist by training and this is the first project of its kind that he has undertaken in ADB. Social development specialist inputs will help better assess the quality of participation by the community, but he feels that the process is satisfactory and the community-driven approach successful.
4.4.2.4 Insights
147. The project has shown that the participatory process may take time but has its rewards. Much time was taken in designing and defending the project design and initial implementation problems added further delays. Nevertheless, the latest review mission reports: “…with proper guidance, village people can be relied upon for correct implementation of village infrastructures. The works are carried out satisfactorily, and local contribution often exceeds what is expected according to Project arrangements.” Thus, the investments in time are slowly paying off.
148. The length of time taken to approve project design indicates that ADB does not yet understand or accept the tradeoffs between the risks and potential benefits of participatory processes. While the frontline staff are confident to take the risks because of their direct exposure in the field, headquarters staff are concerned about following procedures to mitigate the risks.